The issue is when currency fluctuates, you have capital gains or losses, depending on whatever you consider to be your home currency. These gains/losses are unrecorded (but not unrealised). C
On Fri, 22 Jan 2021 at 04:36, w...@theprescotts.com <w...@theprescotts.com> wrote: > I am probably missing something here. > > I have bank accounts in two countries and regularly transfer money between > them. Whenever I move money, I record the transaction and the amount for > each side of the transaction. Gnucash automatically makes an entry in the > Price Database recording the conversion rate. > > It seems much cleaner than treating one currency or the other as a > commodity that is bought or sold at some rate. One thing that is a little > strange is that the Price Database has separate tables for each direction. > I suppose it depends on which side of the transaction I use to record the > transfer. But I almost never look at the Price Database so it doesn't > bother me much. > > Will > > On 2021 Jan 21, at 01-21 20:06:04, Lukas Haase <lukasha...@gmx.at> wrote: > > Hi Christopher, > > This is very sad. Sad for various reasons. > > I went over these documents previously (but did not read them thoroughly). > > My takeaway is: > * Storing the conversion rate per transaction makes the accounting > equation as a function of time inconsistent (but it is consistent for each > snaphot in time). > * Trading account accounts for these inaccuracies. > > My question was more why the trading accounts (which seem to me the > cleaner, superior and better way) are not enabled by default. > > Also, can you comment a bit more why precicely this would be a major > minefield? (If you know it, of course). > > Multiple databases are just extremely hard for some people (like me). > > Consider living for a couple of months to a year in a different place. > There is just no way to separate this in a clean way without replicating > all the transactions in different databases. BTDT. > > Also I moved multiple times. Even then, there is no clear cut: Initially I > would use credit cards, ATM etc. from previous country. Even the first or > second rent may be partially paid with funds from the previous location. It > takes a few months until I could consider the books between two countries > sufficiently separate. The only ways are a) Massive transaction Replication > b) booking everything I pay with funds from old country into old database. > But with my rent example, it gets very inconsistent how much I paid rent at > the new place. > > Lastly, simple portfolio accounting (e.g. crypto currencies) if they are > bought in different countries. > > I am curious what the potential mines are so I can try to avoid them. > > Lukas > > > > On 2021-01-21 20:20, Christopher Lam wrote: > > Multicurrency is a major minefield. > > Start from > https://www.mathstat.dal.ca/~selinger/accounting/tutorial.html > > and finish with > > https://www.mathstat.dal.ca/~selinger/accounting/gnucash.html for the > > background on trading accounts. > > From discussion with accountant, it would seem that the safest approach > is > > to have 1 book per home currency. When you move countries you'd be better > > off with a new book with a new home currency. Taking temporary trips > abroad > > gets the currencies translated to home currency. AFAIU. IANAA YMMV. > > https://techcrunch.com/2010/08/14/internet-must-be-true/ > > On Fri, 22 Jan 2021 at 00:59, Lukas Haase <lukasha...@gmx.at> wrote: > >> Hi Mike, > >> > >> On 2021-01-21 02:24, Mike Alexander wrote: > >>> On 19 Jan 2021, at 20:08, Lukas Haase wrote: > >>> > >>>> So I got recommended using trading accounts. But suddenly all my > >>>> previous multi-currency transactions get a small grey box with a cross > >>>> (hinting the transaction is inconsistent). > >>>> > >>>> How do I best deal with this? > >>>> Is it possible to keep my old multi currency transactions as-is and > >>>> use trading accounts only for securities/stocks? > >>>> > >>>> If not, how do I migrate while ensuring my ten years worth of data > >>>> does not suddenly get inconsistent? > >>> > >>> You should be able to use the "Check & Repair" commands in the Actions > >>> menu to add the trading account splits to existing transactions. I > >>> would certainly save a copy of my data before doing this, and try it on > >>> a few transactions first. Your situation is complex enough that it is > >>> not unlikely that this won't do exactly what you want, but it's worth a > >>> try assuming you have good backup. > >> > >> Thank you, I think that worked indeed. > >> > >> I still need to cross-check everything (at the first glance things look > >> OK). > >> > >> So then I'd have a general question on the multi currency feature: > >> > >> 1.) Are "Trading Accounts" just an *alternative* way to handle multi > >> currencies (and as such have nothing to do with "trading")? > >> > >> 2.) Trading Account seem to be way more powerful than storing the > >> exchange rate in each transaction > >> > >> 3.) Why exactly aren't they enabled by default if they are so superior? > >> Why let people my default use the way that makes things less consistent > >> and error-prone? > >> > >> Thanks, > >> Lukas > >> > >> > >> > >> > >> _______________________________________________ > >> gnucash-user mailing list > >> gnucash-user@gnucash.org > >> To update your subscription preferences or to unsubscribe: > >> https://lists.gnucash.org/mailman/listinfo/gnucash-user > >> If you are using Nabble or Gmane, please see > >> https://wiki.gnucash.org/wiki/Mailing_Lists for more information. > >> ----- > >> Please remember to CC this list on all your replies. > >> You can do this by using Reply-To-List or Reply-All. > >> > > _______________________________________________ > > gnucash-user mailing list > > gnucash-user@gnucash.org > > To update your subscription preferences or to unsubscribe: > > https://lists.gnucash.org/mailman/listinfo/gnucash-user > > If you are using Nabble or Gmane, please see > https://wiki.gnucash.org/wiki/Mailing_Lists for more information. > > ----- > > Please remember to CC this list on all your replies. > > You can do this by using Reply-To-List or Reply-All. > > > _______________________________________________ > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > If you are using Nabble or Gmane, please see > https://wiki.gnucash.org/wiki/Mailing_Lists for more information. > ----- > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All. > > _______________________________________________ > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > If you are using Nabble or Gmane, please see > https://wiki.gnucash.org/wiki/Mailing_Lists for more information. > ----- > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All. > _______________________________________________ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.